Customer Service Case Study: A Nightmare at Disneyland!!

The plaque at the entrance of Disneyland in California reads: "Here you leave today, and enter the world of yesterday, tomorrow and fantasy".  The very core of the Disneyland brand has been to take you to that fun and magical place.  Our recent family trip to Disneyland was anything but fun and magical.  It was more a page out of a Freddie Krueger horror story.  And, if Walt Disney could see all the corporate greed for maximizing money making, at the expense of a fun user experience, he would surely be turning in his grave.  Below is a summary of our experience, and lessons for us all to learn for delivering a world-class customer experience (or not!!).

PARKING FAIL

You know you are not off to a good start, when despite arriving an hour before opening, you still have to wait an hour just to park your car.  The flow from the highway exit to the lot was bumper to bumper for about a mile, and when you finally arrived at the pay booth, six lanes merged down to one lane in a chaotic mess.  It was like Disneyland had never had to deal with parking flow issues in their sixty year history before.

FOOT TRAFFIC FLOW FAIL

The average person can walk at around three miles an hour; we were lucky if we were walking one mile an hour.  It was so overcrowded in the park, you felt like you were part of a herd of cattle being lead to the slaughter.  You should never feel like waiting in lines for the rides, was actually a reprieve from the chaos of walking through the park itself.

PARK DESIGN FAIL

Disneyland prides itself on how well-designed its park is, with "invisible" operations behind the scenes.  But, to me, the "visible" part of the park, was very poorly designed to handle large volumes of crowds.  There were so many "pinch points", where a wide walkways narrowed down to a thin walkway, creating crazy bottlenecks.  And, there were many "dead ends", where you needed to reverse direction back through crazy crowds, to get where you thought you were originally heading (based on very poor signage).

WAIT TIMES FAIL

There are around eight main sections of Disneyland, each with a main ride therein.  In a good user experience, in a 9-5 day, you should be able to ride each of the eight main rides in an eight hour day, with no more than an hour wait for any one ride.  Wait times were approaching two hours on many of the rides, which means the visitors were only able to experience around half of the rides offered.  Fun is enjoying the rides, not waiting in lines for the rides.

FAST PASS FAIL

I like the concept of a Fast Pass, to get a set reservation time to avoid a busy line.  But, the fails were many here: (1) you can't set reservations anywhere but the ride area, which means you need to battle crowds and wait in lines just to get your Fast Pass; (2) you are limited to one Fast Pass reservation every two hours, which reasonably means you only get a couple chances to use it per day; and (3) if you don't return in your slotted time, you lose your reservation (and many people were missing their one hour reservation time window because the crowds were so bad to get back to that part of the park in time).

MARCHING BANDS FAIL

I love marching bands as much as anyone, but there is a time and place.  You should not close down the main foot traffic walkways of the park, to accommodate marching bands on the busiest days of the park.  That takes a slow user experience, down to a crawl.  If you want bands, put them on the main stage at the entrance of the park, where they won't impede foot traffic flow during your peak times.

RESTAURANTS FAIL

When it is lunch time, around noon, and you can't get food for your kids until after an hour or two of waiting in long lines, there is a major problem.  And, when you finally get your food, and there are no empty tables for you to sit down and enjoy your meal, that just compounds the problem.  And, when you find the one open restaurant in the park with 20-30 open tables, and you are are turned away because you didn't have a pre-booked reservation (which many people missed due to crowds impeding foot traffic) is just plain stupid.

I understand the Disneyland amusement park experience has been in our country's core DNA since 1955, or over 60 years now.  That is around three generations worth of families that have taken their families to the Magic Kingdom for that break away from reality and to fantasy.  But, when that experience has become more of a nightmare, at the rapidly growing entry cost of $100 per person (and easily double that with parking, food and souvenirs), maybe it is time for the country to have a new family tradition.

Perhaps that is visiting any one of our 59 national parks, where the experience is equally spectacular, the land is plentiful and you won't be cattle-herded up against 65,000 other travelers.  Or, if amusement parks is a must, there are scores of them across the country--take your hard earned money to other parks that better respect your user experience.  For example, we visited Universal Studios in Hollywood, Legoland and the San Diego Zoo that same week we visited Disneyland, and they were delightful in comparison.

Anyway, take these business lessons to heart: (1) don't mis-serve your customers in delivering a poor user experience (regardless of how much money you can make); and (2) don't take your history and customer loyalty for granted (you never know when they will hit their breaking point and take their family and money elsewhere).  Disneyland should have capped their user maximum at a much lower level to preserve a better user experience (even if they needed to raise prices to enable that).

I know I will never go back to Disneyland after this recent experience, and I recommend you don't make the same mistake I made: trusting our once-in-a-lifetime family experience to Disney (did I really just say that??!!).  I am sure Walt and the brand team at Disney are cringing as those very words are leaving my mouth, as it is 100% counter to the brand positioning they are aspiring towards. But, it has become the stark reality, based on the current generation of Disney executives who have forgotten how to put their customers first (not their bottom line).  They may not feel the financial impact in this generation, but they surely will in the next.

__________________

ADDENDUM ADDED 1/13/16:  I have to give credit where credit is due.  I got an unexpected call from Disneyland this week after they read this blog post.  They said I raised a lot of fair points, apologized for the poor experience, acknowledged it was one of their busiest days of the year and told me their team is brainstorming the overcrowding issues to remedy it in the future.  Then, they offered my family five free Park Hopper tickets (a $750 value) to use on our next visit, anytime in the next two years.  That was an unexpected and appreciated offer, and a professional and honest way to treat an upset customer.  Problem is: with my family in Chicago, the odds of flying my family out to Los Angeles a second time in two years is pretty low.  So, I won't be able to take advantage of it.

For future posts, please follow me on Twitter at: @georgedeeb

Lesson #224: When to Take Off the Gloves With Competitors

Let’s face it: every company needs to deal with competition.  You compete on your product offering, your pricing, your customer benefits, etc.  And, for the most part, relationships against competitors, follow some sort of decorum, as best as two competitors can.  You usually speak to your company’s advantages, you keep the pitch factual and you don’t stoop to the level of bad mouthing the competition.  But, your competitors don’t always follow that logic, and oftentimes, they can come out swinging, especially if they are a new entrant in the market trying to knock out the incumbent industry leader.  So, when that happens, you have no choice other than taking off the gloves, and getting your hands dirty.

Competitive Case Study

I wanted to use a case study to help bring this story to life.  One of my Red Rocket clients was a pioneer in their industry, had the largest market share by a wide margin, and was perceived as the best in the market.  This afforded them the ability to charge premium prices and maintain rich margins.  But, a new competitor came along that had one clearly stated goal: to take down the king of the mountain, my client, primarily on a price driven advantage.  And, they would do whatever was necessary to make that happen.

This competitor did not play by normal rules of engagement.  They would price their product at half of market value, trying to steal accounts and get their foot in the door, even if it meant big losses to their bottom line.  They over-inflated the hype around their true product capabilities, which didn’t hurt them during the sales phase (only during the renewal phase when clients would drop them after being disappointed with the reality).  But, even worse, they would completely lie to customers, about my client with ridiculous made-up stories designed to create fear or give the customer a reason to move their business.  That is where I drew the line you should never cross: you just don’t lie in business.

What We Did About It

This is when we started to “take off the gloves” to better defend our turf.  In our RFP responses we would add a section about our competition (in general) and where we saw our strengths vs. other players in the industry, firing away against the weaknesses of our competitor (on a no names basis).  We added client testimonials and reference information of customers that had worked with both companies and had been “bamboozled” by our competitor (again on a no names basis), and came running back to our client.  And, we designed a lower-price point version of our product, to take the pricing discrepancy away. 

The Outcome

And, the good news . . . it worked!!  We finally were able to stop the “bleed”, losing existing clients to this competitor.  And, better yet, we won the next three competitive RFP situations against this competitor with our new and improved pitch.  And, worth adding, we did NOT go to the point of “no holds barred”.  We didn’t call the competitor out by name, we didn’t do it in a negatively intended tone, and most importantly, we did not lie to try and win business!!

In Conclusion

When pitching against competitors, do your best to always take the high road, where you can.  Speak to your strengths without bashing your competition.  You don’t want to have to “take off the gloves” unless you have no other choice.  But, if you are dragged down into one of those ugly situations, as discussed herein, don’t just take the “ass whooping” lying down.  Get in the ring, and punch your competitor right in the mouth (in a way your customer won’t perceive it as you doing it a specific or malicious kind of way). 

When Joe Frazier is pounding away at you, time to bring out your inner Muhammad Ali!!

For future posts, please follow me on Twitter at: @georgedeeb.

Lesson #223: Ten Things You Need to Know When Responding to RFPs

If you are in the B2B space, odds are you will need to respond to Requests for Proposals (RFPs) from prospective customers throughout your normal course of business.  The RFP process is typically filled with potential pitfalls along the way.  This post will hopefully help you learn what those pitfalls are, and more importantly, how to avoid them.

1. Understand the Process

RFPs basically lay out all the specific project needs and questions of the customer in one document, which they send out to numerous competing bidders.  From there, the customer will typically narrow down all the submissions to a handful of finalists.  The finalists will be given the opportunity to ask any questions they have, and the customer may also ask additional questions of the finalists, as they compare and contrast the various proposals.  A final proposal is then submitted by the finalists, and the customer selects their winning bidder to move forward with.  This process can take from weeks to months to complete, depending on the size and complexity of the project.  And, expect enterprise customers to have a much more onerous process than SMBs, as that often means a procurement department will be involved (in addition to the business people needing the solution).

2. Make Sure You Are Aware of RFPs in the First Place

You can’t close sales if you are not aware of the RFPs in the first place.  So, you need to identify all prospective customers in your space, and make sure you are on their radar and ask to be included in any of their RFP requests.  Also, oftentimes, bigger companies will engage third party RFP process management companies to run the process for them.  So, uncover those third party companies that are active in your industry, and make sure you get on their radar, as well.

3. Be Prepared for Last Minute Requests, and Tight Deadlines

RFPs can often come in last minute, with a very tight deadline for submission (e.g., around two weeks).  The more complex the project, the tougher it is to pull together a thoughtful response in a short period of time.  For this reason, you should have a template RFP on the shelf, for when the RFP comes in, you have 80% of the standard materials all ready to go, and you can focus on the 20% that needs to be customized for that particular proposal.   Prepare for RFP responses to be a big distraction while they are happening, and the better prepared you are, the less of a distraction it will be.

4. Have a Well-Written and Thoughtful Response

A good response will typically have the following sections: (i) about your company; (ii) what makes you better than competitors; (iii) your specific thoughts on the RFP project, and how you are uniquely qualified to succeed; (iv) answers to any of the customer’s specific questions; (v) your pricing section; and (vi) your happy client references.  And, the response should be visually appealing, with graphic images carrying more weight than dense paragraphs of copy.  Most importantly, talk in the “customer’s voice” and intersperse their logo and images throughout the presentation, so they know you understand their business, and it looks like you put customized work into your response, tailored just for them.

   

5. Don’t Disclose Your “Secret Sauce”

At the same time you are trying to distinguish yourselves from your competitors, be very careful NOT to give away your “secret sauce” in your response.  There are very high odds that the customer will see your unique advantage in your response, and may ask the other bidders if they can do that too.  Which does two things: (a) educates your competitors on what you do; and (b) gives the competitor the chance to say, “sure we can do that”, whether they were or were not planning to in their initial response.

6. Bundle Price Where You Can

The more details you provide in your pricing proposal, the more specific line items the customer can try to negotiate down.  So, as an example, if you are a platform technology vendor, don’t detail pricing for all the various features and functionality in isolation, line by line.  Instead, aggregate pricing for the platform as a whole.  You want to make it is hard as you can for the customer to “turn the screws”, and truly understand your net margin on the project.  Understand, your customers will do everything they can to try and break out the details.  So, tread carefully and dig in where you need to.

7. Don’t Quote Your Lowest Price

Back in Lesson #39, I wrote about the art of negotiation.  As this post suggests, you need to leave the customer room for a “win”.  And, that win typically means letting the procurement department look smart to their boss, by having them negotiate further price savings from the original quote.  So, let’s say you normally like to price your business with a 50% gross margin.  Quote at 60% in the RFP, knowing procurement will be expecting at least a 10% haircut from there during the process.

8. Strategically Leverage the Q&A Process

There are two parts to consider when asking and answering questions during the Q&A process:  (i) protect yourself; and (ii) make life miserable for your competitors.  As for the former, all questions asked and answers answered will normally be shared with all the competing bidders.  So, be careful not to ask any question, where the questions itself, or the answers therefrom, will help educate your competitor on how exactly you do your work, which may be a unique advantage you want to keep secret.  And, on the flipside, if you know you are materially better than your competitors in certain areas desired by the customer, ask questions will that you know your answers will far outshine your competitors.  This is really a fine line to walk; you want to show off your strengths, but not all of your strengths that will give your competitors intelligence.

9. Beware the Procurement Department

There are typically two departments involved in the purchase decision: (i) the business people needing the solution; and (ii) the procurement department negotiating the contract.  The procurement department’s job is to save the company money, and often times, their personal bonuses are tied to the quantity of those savings.  Which means, even if you are the 100% ideal solution for the business people, the procurement department might start “lobbying and biasing” a different solution, if it makes them look smarter to their bosses.  Typically, the business people win out on small price differences, but the procurement department gains a lot more leverage the higher your prices are versus others, even if the business people selected you.  So, make sure you make friends with the procurement team, at the same time you are working the business team, and keep a close eye on your competitors’ pricing.

10. Leverage Back Channels

During the RFP processes, you are typically disqualified if you reach out to the customer during the process, trying to push or promote yourself.  They don’t want to be distracted by numerous bidders while they are trying to do their work.  But, you need intelligence during the process, so you can act on that information before it is too late.  Make sure you have “friendly” people in your back pocket, that are aware of the process and the discussions thereto, but are not directly involved in the process.   For example, let’s say you are pitching a social media technology solution to a brand.  Maybe you are friendly with someone at their social media agency or in their digital marketing team, that are colleagues with the decision makers, and can sniff around for “inside information” on your behalf.  But, be careful, these have to be VERY close friends of yours, where you are sure your intelligence gathering will not make it way back to the customer and disqualify you.

I bet you never realized how many moving pieces are wrapped up in a successful RFP response.   Hopefully, you are better educated on the process, to help you win the next one.

For future posts, please follow me on Twitter at:  @georgedeeb.

[VIDEO] George Deeb Talks Startup Marketing, Hot Chicago Startups & Coding in Schools with Tasty Trade

Red Rocket's George Deeb was recently interviewed by Tom Sosnoff and Tony Battista for Tasty Trade's "Bootstrapping in America" program. In this video, George talks about startup marketing, hot Chicago startups and the importance of getting coding into the school curriculum.


George Deeb Talks Startup Marketing, Hot Chicago Startups & Coding in Schools from Red Rocket Ventures on Vimeo.


This video is courtesy of Tasty Trade, all rights reserved. Be sure to check out Tasty Trade's other "Bootstrapping in America" programs on YouTube.

For future posts, please follow us on Twitter at: @RedRocketVC

[VIDEO] George Deeb Teaches Startups How to Build Team & Advisors

Red Rocket's George Deeb recently presented a "How to Build Your Team & Advisors" session for the new class of startups at Founder Institute in Chicago. This video tackles the following topics: How do you find the right team to launch your company? How do you identify the right set of advisors? How do you manage your advisors? What are responsibilities and compensation for advisors? How do you identify the right roles to help you launch a product or offering? Do you expect the roles to change over time? How can recruit people to fill roles when you have limited resources? What metrics do you track when recruiting? Do you need a cofounder? What are some common pitfalls with cofounder? Is a team necessary to launch a company?

Sorry for the poor quality of the video.  But here it is:


George Deeb Teaches Startups How to Build Team and Advisors from Red Rocket Ventures on Vimeo.

And, here is the matching Slideshare to go with the presentation:

How to Build Your Startup Team & Advisors from Red Rocket Ventures

For future posts, please follow us on Twitter at: @RedRocketVC

Red Rocket's Best Startups of 2015

Red Rocket gets introduced to hundreds of startups each year, in the normal course of doing business, or via our involvement with FireStarter Fund, TechStars, Techweek, VentureShot, Founder Institute or other startup groups or events.  We wanted to honor the best of these startups that we met in 2015, in Red Rocket's 4th Annual "Best Startups of the Year".  This list is not intended to be an all-encompassing best startups list, as there are many additional great startups that we are not personally exposed to each year.  And, this list is not intended to be only for businesses that launched in 2015, it is open to startups of any age, that they or their advisors had some personal interaction with us in the last 12 months.  The business simply needed to have a good idea, good team or good traction, that caught our attention.  Congrats to you all!!

THE BEST STARTUPS OF 2015 (in alphabetical order):

Apollo Medical Devices (CEO Patrick Liemkuehler) - B2B Rapid Blood Testing Technology

Bitsbox (CEO Scott Lininger) - B2C Subscription Box That Teaches Kids to Code Technology

Block Six Analytics (CEO Adam Grossman) - B2B Analytics & Marketplace for Sponsorships

Boatbound (CEO Aaron Hall) - B2C Private or Captained Boat Rentals

Built In (CEO Maria Katris) - Localized Business Networking Websites for Digital Tech Space

Dose (CEO Emerson Spartz) - B2C Daily Dose of Amazing Content & Virality Platform

Fitspot (CEO Jonathan Cohn) - B2C On-Demand Personal Trainers to Your Home 

Fooda (CEO Orazio Buzza) - B2C At-Work Lunch Catering Platform from Local Restaurants

Growth Geeks (CEO Bronson Taylor) - B2B Freelance Growth Hackers on Demand

HighGround (CEO Vip Sandhir) - B2B Employee Engagement Platform

Home Chef (CEO Pat Vihtelic) - B2C  Weekly Home Meal Kit Deliveries 

Hooks (CEO Oleg Kozynenko) - B2C Push Notifications for Anything You Want 

Maiday (CEO Sara Bokan) - B2C On-Demand Home Cleaning Service

Networked Insights (CEO Dan Neely) - B2B Social Listening & Insights Platform

Otobots (CEO Arun Simon) - B2C On-Demand Auto Mechanics to Your Home

SoloInsight (CEO Carter Kennedy) - B2B  Smart Gates and Workforce Management Software

Uptake (CEO Brad Keywell) - B2B Internet of Things Data Insights Platform

WeLink (CEO Nathan Chandra) - B2B Location-Based Social Listening Platform

And, don't forget to check out the 2012 winners, 2013 winners and 2014 winners, many of whom continue to be doing great things.

Congratulations to you all!!  Keep up the good work.  

For future posts, please follow us at: @RedRocketVC

How to Evolve from Selling Widgets to Selling Wisdom

I've previously written about the 1,024 different types of salespeople there are and the difference between selling simple products vs. ones that are much more complex and consultative in nature. I like to call this the difference between selling “widgets” vs. selling “wisdom.” So, what follows are some further thoughts on the difference between the two, the advantages of selling wisdom and ways in which you can effectively transition your selling efforts from "simple products" to "wisdom."

Read the rest of this post in Entrepreneur, which I guest authored this week.

For future posts, please follow me on Twitter at: @georgedeeb.

The CEO's Role Must Change as the Company Scales

I have previously written about The Role of a Startup CEO, during the company’s early stage of development.  But, if your company hits is stride and starts to materially grow revenues, I thought it was important to talk about how the CEO’s role needs to evolve as the company starts to scale. For simplicity sake, I am going to compare the role of a CEO in businesses between zero to $10MM in revenues (early stage), versus CEOs in businesses between $10MM to $50MM in revenues (growth stage).

Read the rest of this post in Forbes, which I guest authored this week.

For future posts, please follow me on Twitter at: @georgedeeb.

[VIDEO] George Deeb Evangelizes Tech Coding for Core K-12 Curriculum

Red Rocket's George Deeb has recently been working with his local school administrators to emphasize the importance of learning to code technology, which he feels is a major void in the current core K-12 curriculum, one which is designed for a different era of students and eventual workers.  As part of that, he was invited in to present this concept to the fourth graders in the school, which is shown in this video. So, although the message was delivered in a student friendly way, the message should equally resonate with parents, teachers and school administrators.

We share this video with you, because we feel every student in our country needs to learn the basics of coding technology by the time they graduate high school, the reasons of which are shared in this video.  If you feel this message resonates with you and you want to make a difference in your own schools, please share this video with your local school administrators.  Hopefully, our collective efforts in our respective school districts, will make a collective difference in our schools at the national level, and help lay the foundation for a strong economy of well-employed workers for generations to come.


George Deeb Evangelizes Adding Tech Coding to Core K-12 Curriculum from Red Rocket Ventures.

If you prefer to have something in writing to share with your schools, below is a synopsis of what was covered in the video:

WHAT IS THE GOAL OF GETTING AN EDUCATION

• To increase your intelligence, and gain skills that will enable you to get a good job when you graduate?

KEY TRENDS—HIGH LEVEL JOB MARKET

• The rising cost of living, is making it harder for people to retire.  (define cost of living)
• When people don’t retire, it makes it harder for many college graduates to find good jobs
• And, with the rising cost of college education, many college graduates build up big college loans without finding a job that can help them pay back those loans (define loan).

KEY TRENDS—TECHNOLOGY & ENTREPRENEURSHIP

• But, the technology industry is exploding with lots of open jobs
• Over 100,000 open tech jobs in Chicago alone, up 2x in the last year alone
• And, these tech jobs are in such short supply, not enough trained technologists, the ones that are trained quickly have companies competiting for them, and paying them big salaries in the $100-$200K range
• This is fueled by technology companies like Google, Apple, Microsoft, Amazon and 1000’s of others you have never heard of
• Technologies are even taking over non-technical industries like manufacturing via IoT, further accelerating the amount of companies that need technology coders 
• The technology coding demand is highest around studying large amounts of data and driving insights that can help make better business decisions 
• And, the U.S. are competing in a global ecosystem of businesses—up against companies in China, India and beyond, where others a growing technology skills a lot faster than the U.S.
• In fact, the United Kingdom just required every student to learn how to code by the time they graduate from high school, in their core curriculum
• Even the Chicago Public School system has followed suit, rolling out coding into its curriculum this last year.  Chicago Mayor Rahm Emanuel wants to ensure all kids learn to code, as vital to their success.

WHAT IS CODING?

• It is not playing with your iPad or the apps therein.
• It is coding the apps therein, writing the scripts that make the apps do what they do—the layouts, the colors, the movements, the content, etc.
• And, although Kodable and Code.org teaches you how to think like a coder, through games.  It really isn’t teaching you to write the code itself.
• We are talking about learning new technology languages with crazy names like HTML, Java, Python and Ruby on Rails.  There are literally hundreds of technology languages one could learn, based on the need of the technology.

SO, WHY DOES THIS MATTER?

• Learning to code by the time you graduate from high school, ensures that you will easily be able to find a job, especially for the many families that can’t afford to send their kids to college, or don’t want to take on the big college debts without the certainty of finding a job.

WHAT ARE MY PERSONAL CONCERNS?

• Most schools are not required to teach coding in the core curriculum, and many local parents in our district are trying to change that
• The fear is kids today are going to graduate from high school without the skills they really need for this next generation of jobs.  And, if they can’t find jobs, that will ultimately hurt the U.S. economy and our country’s competitive position with the global economy.
• And, there are hurdles when adding new stuff to curriculum, like what other subjects are you going to cut?
• Where I think we can be creative—for art give the choice of pottery or digital design, for language give a choice of Spanish or HTML
• Or, we can even be creative and offer extended class days, weekend programs or summer camps if it is important enough to you kids and your parents

WHAT ARE WE DOING ABOUT IT?

• We are trying to get technology coding formally added to the core curriculum in our district as part of the school’s STEM programs.  So, hopefully, exciting news to come in the future.
• In the meantime, there are plenty of other resources you can take advantage of outside of school, where you can learn how to code:  online websites, summer camps, etc.   

IN CLOSING

• The school and the parents are going to really work hard to get you more coding experience for all the reasons discussed today
• But, if we are can’t get it fast enough, take control of your own destiny, and ask your parents to find you coding classes after school or on the weekends, or coding camps in the summer
• And, make sure your parents tell the school how much you are interested in learning stuff like this, so we can help accelerate our efforts, not only in our district, but for the whole state, if a successful pilot program can be done in our district.
• Coding is no longer a nice to know, it is a NEED to know.  This is really important to your future, and I want to see you all succeed—not only today, but 8 years from now when you graduate from high school.  And, it all starts now!!

Be sure to read my companion piece that I wrote for Entrepreneur Magazine:  K-12 Curriculum Needs Major Overhaul to Develop Entrepreurship Skills.

For future posts, please follow George on Twitter at: @georgedeeb.